HP Finance

SouthyUK

Hi Guys,

New here and, like a lot of you I guess, struggling with my debts.

I have around £21,000 in debt.
£6000 is HP on my car.
£2000 is PCP on my motorbike, with a final payment of £2400 (which is due in a year and I will not be able to clear, but I can hand the bike back at this point and walk away)

The rest is unsecured loan and a bunch of credit cards.

The £6000 on the car is costing £250 a month, but more than that the car is very expensive to run, with insurance at £110 a month (the absolute cheapest I could get) fuel and tax and other running costs, it is costing me £400+ a month to run the car.

The debt is with Black Horse, who I haven't contacted yet, as I want some more information before I call them.

Basically wondering what my options are with regards to reducing and/or ending the agreement with them early (I have only been paying for 13 months of a 60 month loan). How does it work, would they take the car and clear the debt, or is it more complicated than that?

Some more information, my bike payments are £150 a month, the unsecured repayments are £455 a month, which is the worst of my debt as I am paying minimum payments and going to put another £500 on my cards in the next month due to a bunch of expenses coming this month + a holiday with my girlfriend.
Basically removing the car from the equation will free up a chunk of money that I can then use to start paying off my credit cards, I would pretty much put all the £400 a month into my credit cards and aim to clear them all within 2 years.

Thanks for any advice!

chanz4

if you give them a car back so soon, your going to have a big bill. Does the holiday have to happen....

bargainbetty

Is the car on finance, or is it a personal loan/ If it is a personal loan, there is nothing to stop you selling the car and paying off the loan in full (assuming you can realise the depreciated value).

If it is on finance, you will need to check the T&Cs for handing back the vehicle.

Your best bet is to complete a full SOA, and see where your total expenditure is going. You will be able to see where cutbacks can be made (people on here will help) and might be able to find a way to adjust your financial situation.

Are the holiday and other expenses really necessary? If you are already going under, perhaps the decision to stop digging the hole should be made sooner rather than later?

SouthyUK

The car is on Hire Purchase finance, and selling it is not allowed, plus it is in negative equity so I would not be able to pay off the finance even if I did sell it!

I have started an SoA after creating this post, and I can already see areas that I can cut back on, so I might not have to resort to getting rid of the car.

The other expenses are required, it is servicing on the bike, which if isn't paid for voids my warranty, very bad.

The holiday isn't 'required' (is it ever?), but I haven't had a holiday in 2 years, and it is as cheap as we can get it, £250 per person for flights+hotel, already paid for, so the only additional outlay is spending money. Maybe this is me being in a bit of denial and now I write it out I can see how it looks like 'oh just one more time then I will stop' but I really do need a nice break.

I guess the best thing is to contact black horse and see what they say if I tell them I am struggling.

Thanks for the advice.